Rob Keeble
Member
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- 12,633
- Location
- GTA Ontario Canada
One other point i would like to add.
When companies the likes of Grizzly (i am not saying it is the case for Grizzly) buy in bulk from manufacturers, very often the terms of their deal is such that these kind of pricing structures are based on no warranty claims back to the factory.
The idea being that an extra say 5% reduction in price on a bundle of goods is obtained on that basis simply because the seller then need not create a provision against the sale income for warranty.
Logistically it also frees up both parties and you can imagine the cost that would be involved in the two parties tracking a faulty xyz part between them what with customs and shipping alone.
So factor in that when Grizzly sells you that few hundred dollar bandsaw or whatever, and on top of it offers u a warranty in US accounting terms they would be taking an amount out of that sale to keep on the balance to provide for warranty coverage. Same way any other supplier (including woodworkers working from small shops) should be doing.
The magnitude of this amount is calculated based on prior experience for a similar device or model.
The net is though it eats into any margin being made.
So when you examine the whole equation, the risk assumed by Grizzly versus your risk for your few hundred hard earned dollars is certainly not equal and there is value being created by Grizzly in doing this.
Go buy an ebay chinese machine and expect all the same sefvices you do from Grizzly. I think u know the answer to that one.
Sent from my SGH-I337M using Tapatalk
When companies the likes of Grizzly (i am not saying it is the case for Grizzly) buy in bulk from manufacturers, very often the terms of their deal is such that these kind of pricing structures are based on no warranty claims back to the factory.
The idea being that an extra say 5% reduction in price on a bundle of goods is obtained on that basis simply because the seller then need not create a provision against the sale income for warranty.
Logistically it also frees up both parties and you can imagine the cost that would be involved in the two parties tracking a faulty xyz part between them what with customs and shipping alone.
So factor in that when Grizzly sells you that few hundred dollar bandsaw or whatever, and on top of it offers u a warranty in US accounting terms they would be taking an amount out of that sale to keep on the balance to provide for warranty coverage. Same way any other supplier (including woodworkers working from small shops) should be doing.
The magnitude of this amount is calculated based on prior experience for a similar device or model.
The net is though it eats into any margin being made.
So when you examine the whole equation, the risk assumed by Grizzly versus your risk for your few hundred hard earned dollars is certainly not equal and there is value being created by Grizzly in doing this.
Go buy an ebay chinese machine and expect all the same sefvices you do from Grizzly. I think u know the answer to that one.
Sent from my SGH-I337M using Tapatalk